South Korean Won: Equity rout drives downside hedging – MUFG

Michael Wan at MUFG notes that a sharp sell-off in South Korean equities has boosted demand for South Korean Won downside protection. The KOSPI fell heavily, led by semiconductor names amid concerns over Chinese competition and AI capex sustainability. KRW risk reversals show investors paying more for protection, consistent with sizeable foreign equity outflows and related Won selling.